The influx of parallel traders who buy their stock tax-free in Hong Kong to resell it in mainland China at a profit is causing growing unrest. Residents of Sheung Shui, a town close to China's border, say the increase in parallel importers has pushed up retail prices and causes a general nuisance. Importers argue that their trade benefits the Hong Kong economy.

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PARALLEL-GOODS TRADING

Government mulls the meaning of 'milk powder' in the two-tin ban

Government wants to clarify its definition in the two-tin ban, but that may bring new problems

The definition of milk powder can be amended to fine-tune a ban against the unlicensed export of infant formula, health authorities say.

The proposal comes after the administration apologised last week for the wrongful arrests of 12 mainland visitors who were carrying rice-based baby cereal across the border.

Legislators say the new definition may deviate from the law's original purpose, affecting items that are not targeted, such as milk for adults and beverages like Horlicks.

The current definition under the ban covers "all substances in powder form that are or appear to be for consumption by a person aged under 36 months, and are or appear to be milk or milk-like substances in powder form to satisfy wholly or partly the nutritional requirement of a child".

The Food and Health Bureau proposed removing the words "appear to be". But this would effectively ban almost all forms of milk powder, as most claim to be suitable for anyone above the age of two, lawmakers say.

"From the perspective of paediatrics, there is a difference only between milk for children under the age of one and those over that age," medical-sector lawmaker Leung Ka-lau said. "Children over two years old can drink adult milk."

Marion Lai Chan Chi-kuen, permanent secretary for food and health, replied: "If we stipulate that the milk formula is intended only for infants under 36 months old, then milk providers on the market may skirt the ban easily by claiming that their products are suitable [also] for those above 37 months."

Lawmaker James To Kun-sun asked what law enforcement officers would do if they caught a traveller with more than 1.8kg of milk powder in containers without description labels.

Thomas Lin Shun-yin, acting head of land boundary command at the Customs and Excise Department, said this would be rare as the value of the product in the parallel-goods trade would be low if it were removed from its original packaging. Lai said the product could be tested to verify if it was infant formula.

General Chamber of Pharmacy chairman Lau Oi-kwok said the chamber would meet suppliers next week to work out a scheme to ensure a stable supply. "One initial idea is … if a local mother can produce some certificates, she will get priority."

Meanwhile, 11 suspected parallel-goods traders from the mainland were arrested in Sheung Shui on Wednesday. A large amount of milk powder, diapers, baby food, cosmetics and daily necessities were seized.

This article appeared in the South China Morning Post print edition as Mulling the meaning of 'milk powder'